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  • Writer's pictureJason Lowtower

Will the bid for SWEDISH MATCH really go through?

Philip Morris further extends the acceptance deadline for the bid for Swedish Match. The new date is set for November 4 this year. This is stated in a press release. The question everyone is asking now is: will the deal go through or has something happened that will cause the deal to be cancelled?

As of October 3, Philip Morris had received approximately 7.8 million Swedish Match shares in the bid, corresponding to approximately 0.51 percent of capital and votes.

PMI writes that it has received all approvals from authorities and the like required for the transaction, with the exception of the European Commission's handling, which is still outstanding.

Earlier on Tuesday evening, however, Reuters reported, citing sources with transparency, that the EU will grant competition approval.

"PMI's current assessment is that the European Commission's handling will instead be completed at the end of October 2022. The board has therefore decided to further extend the acceptance deadline for the offer, up to and including November 4, 2022," the company writes in the announcement.

“We believe that our offer is still very attractive, especially given the current market conditions. We look forward to completing the transaction, while continuing to actively work on our strategic alternatives to Swedish Match, in case the offer is ultimately not successful," comments Philip Morris CEO Jacek Olczak, in the press release.

At the same time that the industry is anxiously waiting for an answer and no one can give a straight answer, the hedge fund company Elliot steps in and flags that they will increase their ownership in Swedish Match. Is this a buy signal or not?

Elliott's previous ownership in Swedish Match amounted to 5.25 percent. However, it has been reported by Bloomberg that several large hedge funds together hold at least 25 percent of the shares, and some of these must have demanded a higher bid.

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